Steel Partners Loses an Appeal; Bull-Dog Loses About $15 Million

August 8, 2007
By Ken Worsley

Yes, the Steel Partners vs Bull-Dog Sauce saga is still in the news. Earlier today, the Supreme Court of Japan rejected Steel Partner’s appeal against previous rulings that backed up Bull Dog’s anti-takeover defense plans. The Supreme Court, which backed away from the extreme language used by the Tokyo High Court in its previous appeals ruling, stated that treating Steel Partners differently to other shareholders “does not necessarily go against principles of equality if the shareholders’ collective interest is threatened.”

Although the Supreme Court did not issue an opinion on whether or not Steel Partners’ actions made it an “abusive quirer,” as the Tokyo High Court had previously said, the ruling did state that Bull-Dog’s actions were justified, because, “The company merely did not have any rules in place beforehand, but this does not mean that measures to address such situations are not allowed.”

Thus, the shareholder vote stands. Perhaps this could be a show of shareholder power? We would love to know what Scott Callon of Ichigo Asset Management would have to say on this.

In the end, Bull-Dog (unsurprisingly) got the legal backup it so dearly paid for. Although the firm has left its sales projections for the current fiscal year unchanged at 17 billion yen, it has revised its earnings forecast down from a 500 million yen profit to a loss of 980 million yen.

About 2.3 billion yen was paid out to Steel Partners in order to dilute their share in the company. We will be eagerly waiting to see Bull-Dog’s final numbers for this fiscal year…

Filed Under Law, M&A, Steel Partners